| Consensus | Actual | Previous | |
|---|---|---|---|
| Index | 49.5 | 50.9 | 49.5 |
Highlights
The S&P China manufacturing PMI survey shows conditions in the sector improved moderately in May, with the survey's headline index increasing to 50.9 from 49.5 in April. This follows declines in the previous two months, though the index remains well below its February level. Official PMI survey data published earlier in the week, in contrast, showed slightly weaker conditions in the manufacturing sector in May.
Survey respondents reported stronger growth in output, new orders, and new export orders in May. But the survey also suggests that firms are tentative about the outlook, with payrolls reported to have been cut at the fastest pace in more than two years and the survey's measure of business confidence falling to a seven-month low. Respondents reported weaker price pressures, with the survey's measure of input costs falling in May for the second month in a row and selling prices also reported to have been lowered.
Survey respondents reported stronger growth in output, new orders, and new export orders in May. But the survey also suggests that firms are tentative about the outlook, with payrolls reported to have been cut at the fastest pace in more than two years and the survey's measure of business confidence falling to a seven-month low. Respondents reported weaker price pressures, with the survey's measure of input costs falling in May for the second month in a row and selling prices also reported to have been lowered.
Market Consensus Before Announcement
Caixin's manufacturing PMI in May is expected to hold steady at April's sub-50 level of 49.5.
Definition
The S&P Manufacturing Purchasing Managers' Index (PMI) is based on monthly a questionnaire that surveys of over 500 companies which provide an advance indication of what is really happening in the private sector economy by tracking changes in variables such as output, new orders, stock levels, employment and prices across the manufacturing sectors.
Description
Investors need to keep their fingers on the pulse of the economy because it dictates how various types of investments will perform. By tracking economic data such as the purchasing managers' manufacturing indexes, investors will know what the economic backdrop is for the various markets. The stock market likes to see healthy economic growth because that translates to higher corporate profits. The bond market prefers less rapid growth and is extremely sensitive to whether the economy is growing too quickly and causing potential inflationary pressures.
The S&P PMI manufacturing data give a detailed look at the manufacturing sector, how busy it is and where things are headed. Since the manufacturing sector is a major source of cyclical variability in the economy, this report has a big influence on the markets. And its sub-indexes provide a picture of orders, output, employment and prices.
The S&P PMI manufacturing data give a detailed look at the manufacturing sector, how busy it is and where things are headed. Since the manufacturing sector is a major source of cyclical variability in the economy, this report has a big influence on the markets. And its sub-indexes provide a picture of orders, output, employment and prices.
